Kim Beom-su, one of the richest Korean entrepreneurs and the founder of tech giant Kakao, is facing an antitrust probe. As a result, the founder’s wealth has shaken up, leading to the lost spot among the top richest in the country. With a reduction of 4% in the market value, the company’s worth shrank on Monday.
In not more than 90 days, Kim’s wealth has seen a steep fall of $5 Billion since the regulators’ allegation on the founder. His net worth had touched $16.2 billion in June. Kim’s wealth has now reduced to $11.1 Billion as of Tuesday afternoon. It has been the steepest fall in his wealth in such a short period.
The country’s fairtrade watchdog investigated K Cube Holdings, owned by Kakao founder Kim Beom-soo. K Cube Holdings, a subsidiary of Kakao operates in several businesses, including E-Payment services, cab services and the messaging application with around 35 M local users.
According to the Fair Trade Commission, the founder had failed to present some dossiers concerning K Cube in its declarations. Therefore, there was a lack of “necessary information or falsely reported about K Cube Holdings, an investment firm fully owned by Kim, over the past five years.” the commission said.
Kakao ranks fourth in the largest market capitals in the country. On September 8th, its shares started declining again due to market dominance allegations. It was followed by a further decline of 4.23%, that is roughly around 105 USD. Although the graph managed to bounce back on September 10th, the overall growth curve of shares was sloping downward.
The Fair Trade Commissions allegations on the company alarmed regulators’ crackdown on IT platforms. It further resulted in further falling share prices of Kakao. However, Naver’s stocks remained slightly unaffected with only a 0.49% reduction.
According to Reuters, South Korea was fined $177 M for blocking customized versions of android. Joh Sung-Wook spoke to the media on Tuesday. “The Korea Fair Trade Commission’s decision is meaningful in a way that it provides an opportunity to restore future competitive pressure in the mobile OS and app market markets,” the KFTC Chairperson stated.
The news has made the motive clear. The regulating authorities in South Korea will not encourage abused market dominance by market giants. Neither was it merciful to the largest tech company, Google.